Via the AFR:
Trevor St Baker’s ERM Power has received a takeover bid from an offshore acquirer, understood to be London-listed energy giant Royal Dutch Shell.
It is understood Shell has offered $2.465 a share, which represents a 43 per cent premium to the last close and values ERM at about $620 million. .
ERM’s board has agreed to the deal which will be announced this morning, sources said.
Here’s what ERM said of 2018 accounts:
“The Australia Retail business performed well with sales at a record 19.2TWh and underlying EBITDAF up 35% to $71.9 million. Gross margin of $4.90/MWh was ahead of expectations,” Mr Stretch said. “Continued growth in our Energy Solutions business saw a 55% increase in revenue on the previous year realising revenue of $18.9 million. With high electricity prices continuing to drive customers to seek advice and energy efficiency solutions, we have seen an increased share of customers purchasing multiple products to customise their mix of energy solutions.” ERM Power’s generation assets performed ahead of expectations off the back of merchant opportunities for Neerabup Power Station and flexible operating strategies employed around Oakey Power Station with underlying EBITDAF from generation at $43.8 million.
Oakey is a gas peaker in QLD that directly benefits from the gas cartel (of which Shell is a member) artificially keeping gas and power prices too high. Moreover the Energy Solutions business is booming only because of the same reason.
This acquisition is one Australia’s most egregious gas carteliers seeking to profiteer in the power market from its destruction of the gas market.
The ACCC should block it.